Hurricanes look great from space.

Emotions are as powerful as any force of nature. The Marketing and Communication Agency (MCA) research at the IABC international conference in New Orleans shows many companies may have a hurricane of negative emotion on their hands, which could damage company performance. Communicators have a role to play in shaping and harnessing the latent emotions in their organizations - positive or negative. Only by channeling those forces can companies embody the statement "employees are our greatest asset."

The great swirling mass of a hurricane seen from space is a lovely sight. The pent-up energy of its eye draws your eye. But is it negative or positive energy? When a hurricane comes, you run - because you have to, not because you want to.

Many of today's most successful organizations are being driven by a similar negative energy. The economy is in full steam: Profits and sales are up. And yet the evidence suggests that the gears of all this great effort - employees - are driven by negative, not positive emotions.

Indeed, stress and challenge drive two-thirds of today's companies, according to results of a pilot survey conducted during an in-depth session at the IABC international conference in New Orleans last June. In addition, almost half (43 percent) of American participants feel their companies are driven by anxiety. Overall, this unique study of 67 communicators in major global organizations provides unprecedented insight into the emotions driving today's businesses.

The Importance of Emotions

The one thing that sets people apart from machines when it comes to applying knowledge is emotion - it is emotions and beliefs that motivate people to apply their knowledge creatively.

A company's technical expertise and know-how (its intellectual capital) are crucial for success. But how do you turn that knowledge into revenue? Your people are the gears converting that intellectual equity into financial capital. For them to be most effective and profitable for the company, they need to be aligned with the company goals and using that intellectual equity in the best possible way.

Knowledge is replicable - as are software systems, organizational structures, products, services, quality levels and libraries of information. Even work forces can be replicated insofar as numbers, core skills and qualifications can be matched. The only differentiator then is emotion - the heart as well as the mind, the corporate personality: the "nice to do business with" factor, the motivation to do more than the basic requirement.

Similarly, while the work force might easily understand intellectually the values of their organization, it is only by bringing emotions into play that they embrace and live those values - giving birth to the corporate personality that brings the brand to life.

Without that corporate or brand personality (translated into customer service), there is little to differentiate one potential supplier from another, and customers are more likely to convert to the competition.

Emotions shape not only the corporate culture, brand personality, but ultimately business performance also. In today's competitive world, companies are looking for that extra edge - the one that comes from its people and its brand personality. And the emotions driving your business internally affect the way it is perceived externally by customers, stockholders and financial analysts.

What Emotions Are Driving Today's Companies?

Our research shows that stress, challenge and anxiety are the key drivers in the U.S. Outside of the U.S., the emphasis is more on commitment (in Canada) and determination and trust (in Europe and elsewhere). Americans are also twice as likely to mention fear as others. As exhibit 2 shows, key emotional drivers differ slightly by location.

Challenge: Positive or Negative?

Generally, challenge is a positive emotion, but when tied in with other negative factors, such as stress and anxiety, it can take on a negative form itself. For example, in the U.S., two of the top three emotions are negative: stress and anxiety. Outside of North America, the positive emotions of determination and commitment join challenge. Which "challenge" do you think stands most chance of success?

EXHIBIT 2

Current emotional drivers:

Total         USA          Canada        Elsewhere

Challenge     Stress       Commitment    Challenge
Stress        Challenge    Challenge     Determination
Commitment    Anxiety      Stress        Commitment

It seems we are seeing the emergence of a new kind of company; one that drives its employees negatively by leaning on their commitment to the company to the utmost, relying on challenge, stress and anxiety to get the most for its stockholders. So do organizations set out to be hurricanes?

Of course not. However, we do see organizations driven by ambitious goals and stretching themselves to achieve them. In the process of setting and striving for these goals, they can create the negative emotions such as those we saw at New Orleans: stress (66 percent say it is prevalent in their company), anxiety (43 percent) and fear (28 percent).

Companies driven by negative emotions such as stress, anxiety and fear may find themselves in a dangerous position. These emotions can manifest themselves as poor attitudes, increased absenteeism, low productivity, or even industrial accidents, putting business reputation and personality at risk. On the other hand, the benefits of increasing a company's emotional capital are simple to see. Organizations that capture the hearts and minds of their people demonstrate a significant impact on customers, business performance, and stockholders, as PepsiCo freely admits:

"The people who make, move, sell and service our products have the power to make customers smile. Boosting their capability, loyalty and enthusiasm will work wonders" (PepsiCo annual report, 1996).

Harnessing the Power of Emotions

Emotions are the fuel that fires the intellectual capital of the organization. Helping employees to live and breathe the corporate goals is the key to achieving those goals. Here are three steps to help harness positive emotions to achieve corporate goals.

1) Communicate the company goals.

The 1997 Watson Wyatt Work Study shows that companies whose employees understand the overall organizational goals achieve a 29 percent greater stockholder return than others.

2) Ensure people understand the company goals.

Merely communicating is not enough. The most productive relationships are the ones where there is a strong match of goals, where all parties are working for the same ends. Clearly, understanding a company's goals is the second step in being able to support them. According to a Gallup survey, if people make a connection with how their own work affects the bottom line, they are more likely to work to that end.

3) Gain their emotional commitment to the company goals.

The degree to which their own emotional mix relates to the corporate one becomes an important indicator of productivity and therefore profit. The old joke about the number of sociologists it takes to change a light bulb (only one, but the light bulb has to want to change) hides an important lesson. Organizations need to capture not just their people's heads, but also their hearts to unlock the key of their emotional commitment to the organization - the "want to change" factor.

EXHIBIT 4

Future emotional drivers

Total         USA           Canada        Elsewhere

Passion       Passion       Passion       Passion
Pride         Commitment    Pride         Pride
Commitment    Pride         Commitment    Challenge

What Happens Then?

Organizations such as GE Capital and Allstate Insurance are beginning to see the link between emotional commitment and business results, as Exhibit 3 shows.

In other words, successful organizations not only align their people with the company goals, they also engage them in pursuing those goals - levering their emotional capital into financial capital.

Aligning and Engaging

As part of our research, we also asked delegates to outline what emotions they would like to see driving their companies in the future - in other words, what turns them on. Passion and pride are their key goals as shown in Exhibit 4.

Participants from all countries want to see their companies driven by passion, pride and commitment. Currently, only a third believe their companies are driven by passion: 85 percent would like to see it included in the future corporate emotional mix. Nobody wants stress and anxiety driving their company.

Passion is one of the strongest elements of all. It is the emotional equivalent of adrenaline - a motivator that drives us all to incredible limits. A 1997 Coopers & Lybrand (now PricewaterhouseCoopers) survey discovered that the two most important drivers of innovation in companies today are passion and trust. And these are only seventh and tenth in the list of the top 20 emotions that drive companies represented at the conference.

So there is a difference between what people would like to see and what actually occurs. One could argue that the strong financial performance of many of today's companies is being achieved despite the tangential relationship of current and desired emotions.

In a buoyant economy, this difference can lead to one of two things:

* Employees may leave for competitors where they feel more aligned with the goals or emotional climate, or

* your people may not take advantage of all the available opportunities the booming economy provides. In a recession, it can mean:

* The difference between reduced profits and outright losses, or

* reduced productivity at a time when it is crucial to keep it high.

And when a recession or an economic squall arrives, the companies that are able to get the most from their assets are the ones with the greatest chance of Success.

And those assets include employees. Our research suggests that many companies generate a lot of negative and destructive energy - just like the hurricane. As communicators, we have the tools to harness the energy by generating a match between current and desired emotions so that employees are aligned and engaged with their companies' goals and work lifelessly to achieve them - because they want to.

It's the difference between running a gold mine and running away from a hurricane.

EXHIBIT 1

Why customers leave and never return:

The U.S. White House Office of Consumer Affairs asked Technical Assistance Research Programs to investigate why customers do not return to do business with a given organization. The results show how emotion and personality can provide a competitive advantage - or disadvantage!

1 percent die

3 percent move away from the area

5 percent buy from a friend or relative

9 percent prefer a competitor

14 percent will not try the product or service again

68 percent feel the service they received was indifferent or discourteous

Source: Tom Peters, "In Search of Excellence" seminar

EXHIBIT 3

Results from recent work

GE Capital:

"Customer satisfaction is linked to employee satisfaction."

"Lower business costs are linked to employee commitment and satisfaction."

"Customer loyalty is linked to employee loyalty."

Allstate:

"Our ability to move the human mind and heart impacts business objectives."

Kevin Thomson, ABC, is chairman of The Marketing & Communication Agency Ltd (MCA) and 1998-99 president of IABC-UK. He presented an in-depth session on Emotional Capital at the IABC international conference in New Orleans. Stephen Welch is a senior consultant specializing in research at MCA. For more information about this study, contact [e-mail].